There is an old investing lesson that sounds too simple to be useful: a great company can still be a bad investment if you pay too much for it.
That is probably the whole SpaceX debate in one sentence.
SpaceX is not a normal company. Most businesses sell products. SpaceX sells belief. Belief that rockets can be reused. Belief that the internet can be beamed from the sky. Belief that humans may one day live on Mars. Belief that the future can be pulled forward by sheer force of will.
And, to be fair, it has earned a lot of that belief.
When Elon Musk started SpaceX in 2002, the idea of a private company seriously competing in rockets sounded almost ridiculous. Rockets were the domain of governments, defence contractors and giant aerospace firms. It was not the sort of business where a Silicon Valley founder was supposed to walk in and rewrite the rules.
But that is what happened.
SpaceX made rockets reusable. That one idea changed the economics of space. Imagine if every airline threw away the plane after one flight. That was roughly how rockets worked for decades. SpaceX asked a simple but powerful question: what if the rocket could come back?
That question became the foundation of its moat.
Today, SpaceX has a huge lead in reusable rocket technology, thousands of Starlink satellites in orbit, major government contracts, and a launch record that competitors are still trying to catch. In business terms, it has what every investor dreams of: scale, speed, technical knowledge, regulatory assets, and a brand that makes the impossible feel slightly more possible.
Then there is Starlink.
Starlink may be the most important part of the story because it changes SpaceX from a project business into a recurring revenue business. Rocket launches are lumpy. Satellite broadband is monthly. One is like building bridges. The other is like owning a toll road.
That matters.
A good recurring revenue business is beautiful because it turns uncertainty into habit. Customers pay every month. Revenue becomes more predictable. Scale improves margins. The machine gets stronger as more people join.
And the market is enormous. Billions of people still lack reliable broadband. Ships, planes, rural homes, businesses, governments and mobile networks all need better connectivity. Starlink is not just selling internet. It is selling access.
That is the bullish case.
But investing is rarely about whether a company is impressive. It is about whether the future being promised is already in the price.
And this is where SpaceX becomes difficult.
At a potential IPO valuation around $1.75 trillion or more, investors are not being asked to believe SpaceX is good. They are being asked to believe it will be extraordinary for a very long time. A valuation near 90 to 130 times sales does not leave much room for disappointment. It assumes Starlink scales beautifully, Starship works commercially, AI infrastructure becomes huge, losses turn into profits, and competitors remain far behind.
That may happen.
But “may happen” and “already priced as if it will happen” are two very different things.
History is full of companies that changed the world but still punished investors who bought at the wrong price. Railways changed America, but many railway investors lost money. The internet changed everything, but many dot-com investors were wiped out. Cars transformed society, but most early car companies disappeared.
The future can be obvious and still be overvalued.
That is one of the strangest lessons in investing. You can be right about the story and wrong about the stock.
SpaceX also has another unusual feature: Elon Musk himself.
Musk’s skin in the game is remarkable. He put huge amounts of his personal fortune into SpaceX early on. In 2008, when both Tesla and SpaceX were close to failure, he split his remaining money between them. That kind of founder commitment is rare. It is easy to admire because it shows belief not through words, but through risk.
But the same thing that makes Musk a strength also makes him a risk.
SpaceX is deeply tied to him. His ambition, urgency and refusal to accept normal limits are part of the company’s DNA. But he is also involved in Tesla, X, xAI, Neuralink and The Boring Company. No matter how brilliant someone is, time is still a scarce asset. Even genius has only 24 hours in a day.
Investors also need to accept limited control. With Musk’s voting power, public shareholders would mostly be passengers. They may own part of the rocket, but they will not be steering it.
That is not necessarily bad. Many founder-led companies have created enormous value precisely because founders ignored short-term shareholder pressure. But it requires trust. And trust is not a spreadsheet number. It is a judgement call.
So what is SpaceX?
It is one of the most extraordinary businesses of our time. It has a real moat, a huge market, visionary leadership, a powerful recurring revenue engine in Starlink, and a culture that has repeatedly achieved what experts said was impossible.
But it is also expensive, capital intensive, complex, dependent on one person, and operating in industries where failure can be literal, explosive and very public.
Maybe SpaceX becomes one of the great investments of the next generation.
Maybe the IPO price already captures too much of that greatness.
The hardest part is that both statements can feel true at the same time.
That is investing. It is not just about spotting the future. It is about asking how much of the future you are already paying for today.
SpaceX may well be a ticket to the next chapter of human ambition. But even the most exciting rocket still needs gravity in the numbers.
Awet Ghirmay, Head of Investment Research
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